MERCHANT EXPORTER FAILED TO EXPORT WITHING 90 DAYS AND WANT TO SALE TO LOCAL MARKET

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A merchant exporter purchased goods under a 0.1% scheme in December 2021 but couldn't export within the 90-day limit due to the COVID-19 pandemic. Now, in January 2022, they've found a local buyer and wish to sell the goods domestically. The advice given is that selling locally is permissible. However, the supplier who sold the goods at the concessional rate will need to pay GST at the applicable rate, and the merchant exporter will have to pay the revised GST amount to their supplier. Since the purchase was in December 2020 and the local sale in January 2022, the ITC claim deadline for FY 2020-21 (30.09.2021) has passed, meaning ITC cannot be claimed in this scenario.

Aslam Khatri

Aslam Khatri (Querist)

12 January 2022 Dear sir/ma'am,

We Merchant exporter, purchase the goods under the scheme of 0.1%.on Dec-2021, We have to export withing 90 days but due to covid-19 pandemic We were unable to export within 90 days. Till date we stocked the material. Now in Jan-2021, we fined buyer and want to sale in local market. can we sale on local market. ?

Please advice

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

12 January 2022 Yes, you can sale in local market.
The registered supplier shall not be eligible for the exemption (i.e. supply at concessional rate) if the registered recipient fails to export the said goods within a period of ninety days from the date of issue of tax invoice.

Aslam Khatri

Aslam Khatri (Querist)

13 January 2022 sir,

We sold the goods in local market with the normal rate of GST. what consequences faced by us. because we purchase the goods on 0.1% scheme and failed to export. We are unable to give export proofs to registered suppliers from whom we purchase the goods.

Please advice

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

13 January 2022 You will face no consequence. Your seller has to pay GST at applicable rate and file GSTR. Based on which you can claim ITC. You have to pay revised GST amount to your seller.

Aslam Khatri

Aslam Khatri (Querist)

13 January 2022 sir We purachse this Good on Dec-2020 and last date of claiming ITC of FY 2020-21 is 30.09.2021. We sold the good to local market on jan-2022.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

13 January 2022 In such a case ITC can't be claimed but your supplier has to pay GST at normal rate.

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